We build a model of a fixed exchange rate regime with escape clauses and output persistence. In the spirit of the Asian crisis in 1997, persistence in our model arises from inability of the domestic financial institutions to intermediate international credit. Our main message is that since...

Recent currency crises in Filand are analyzed. First probit model estimations suggest that growth, unemployment, real exchange rate and contagion effects have affected the probability of a currenycy crisis. Second, empirical shadow floating exchange rates are formed using a revised version of...

This thesis contains empirically oriented research on currency crises. Empirical models, dealing with identifying the determinants of currency crises and the mechanics of them, are presented. Also, issues related to the measurement of realignment expectations are studied, particularly some...